ERMIAS HABTEUniversity of Bonn, Institute Food and Resource Economics, Germany
In today's world close to 800 million people live in a state of hunger. In the MDG's, boosting external aid is one of the major incentives made available by donors. However aid effectiveness has been in the spotlight for several reasons. Despite a decreasing trend at the global level, food aid continues to be a significant component of development assistance to Ethiopia.

Food aid provision aims at either consumption smoothening or as a long-term developmental resource in food for work (FFW) activities. The normative argument is that participation in FFW enhances the capital stock of households by rebuilding their asset in the aftermath of production shock and (when pre"=emptive arrangements are made) food aid provision guards households from depleting their productive asset. Nevertheless, this study argues that food aid does not similarly affect all aspects of capital stock. The research particularly attempts to gauge the unintended effects of food aid on social capital by making comparative analysis between food aid recipient and non recipient villages. Social capital, defined by the networks and norms, determines an essential component of society's capacity to positively interact and collectively change their living environment. There is a growing consensus that high level of social capital transforms into functional capital.

The research draws information from a structured survey in 175 rural households of selected villages in northern Ethiopia and several focus group discussions held with leaders of formal and informal institutions. Preliminary results indicate that long-term food aid recipient households are endowed with less social capital compared with their non"=food aid receiving counterparts. While both village experience similar levels of network type and density, in specific measures, the non"=recipients are socially better interactive, less conflictive and exhibit higher group and personal trust. Besides, non"=recipient households are also more resilient to production and consumption shocks in difficult times. The empirical work is indicative of the need to have a second look at food aid policy in general and its operational programming in particular. A possible way forward could be empowering the traditionally existing networks to play more roles in food aid targeting and delivery activities.